Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what steps the Government is taking to support challenger banks who have entered or are looking to enter the small and medium-sized enterprise lending market.

The information requested on the number of new entrant banks offering finance for small and medium-sized enterprises is not held by the Treasury. Responsibility for the authorisation of new banks rests with the Prudential Regulation Authority (PRA). The PRA’s Annual Competition Report for 2017 states that since its formation in April 2013, the PRA has authorised 25 new banks in total. The report can be found at http://www.bankofengland.co.uk/publications/Documents/annualreport/2017/compreport.pdf

The Government has taken a number of steps to support challenger banks. This includes: supporting the PRA and FCA to set up the New Bank Start-up Unit to help prospective new banks enter the market and through the early days of authorisation; establishing competition objectives for the FCA and PRA; and launching the finance platforms scheme to help small businesses whose finance applications have been declined by their bank explore alternative finance options, including challenger banks.